Foreclosure King: Best Thing for Distressed Neighborhoods Is Homeowners
The Foreclosure King expands to Detroit to tackle rising foreclosures.
Nov. 18, 2008— -- When "Nightline" first met Odell Barnes, the man known to some as the Foreclosure King, he was on his cell phone constantly, buying foreclosed homes by the dozens from his front porch in South Carolina.
A year later, he's still answering the phone, but he's off his porch and in Detroit.
"It's too big for me," he said of the current housing crisis. "One thousand houses a week? It outgrows you."
Sitting on another front porch -- this time at a burned-out house in Detroit -- Barnes has plunged face first into the nation's housing crisis. He's always bought houses in bulk from banks, but what's changed is that, in the last year, mortgage insurer Fannie Mae has begun dumping foreclosed houses on him. The original owners are gone and Fannie Mae and the banks can't sell any other way.
What's also changed is the volume and locations of the houses he sees all across the country .
"I've always had Detroits, the inner-city houses, but not the Wisconsins, not the Maines," he said. "I'm buying in Maine, I'm buying in Delaware." He also mentions California and Nevada, states where he says he'd never had houses.
"I don't think there is a state I don't buy in anymore," he said.
Detroit has been particularly hard hit. Barnes said that if he buys a package of 100 houses, 10 percent of them may be tear-downs or have serious problems, like fire damage. There are also many livable homes, just waiting for a little TLC.
But in this part of the country, where dying industries have exacerbated the foreclosure problem, there were so many foreclosures being dumped that Barnes couldn't handle all the sales from his front porch. He's opened an office here and brought in partners, like local entrepreneur Abner McWhorter.
"The last thing I think we want with these homes is that they get in the hands of landlords who try to, if nothing else, rent them or mothball 'em, [and] if the market turns around, to cash out," McWhorter said. "We really don't need that as a community right now. I'm glad that we teamed up and we're doing pretty good."